Govt proposes to reduce size of mining concessions

The government is proposing to significantly reduce the size of mining concessions under the mining draft law.

Under the draft law, made available to Petromindo.Com, contractors who look for metal mineral resources can apply for a maximum contract area of 100,000 hectares for general survey and explorations. But, they have to return most of the concessions during explorations to such an extent they will only retain a maximum of 20,000 hectares at the start of production.

Contractors who look for non-metal mineral resources are allowed to apply for a maximum of 25,000 hectares for general survey and explorations. But, at the start of production, they are only allowed to retain 5,000 hectares of the concession.

Coal contractors may apply for up to 50,000 hectares of land during general survey and explorations. But, they have to return most the contract area to the government during explorations that they will only a maximum 10,000 hectares when start production, according to the draft law.

Under the existing regulation, mining contractors are allowed to apply for an unlimited contract area, but they are only allowed to retain a maximum contract area of 62,500 hectares at the start of production.

The draft law states that in case the contractors ask for larger contract areas, the central or regional governments have to seek for approval from the House of Representatives or the regional councils respectively. (Bodega)